HOUSE BUDGET BUMPS UP FUNDING FOR TRADE AGENCIES: House appropriators allocated modest funding increases for trade-related agencies in a draft budget released Sunday. The $81 billion bill provides funding for a range of federal agencies tasked with carrying out many of Democrats' key legislative priorities, such as tackling climate change, reducing gun violence and boosting economic development. Among those line items is money to increase U.S. exports and enforce global trade rules. Here are the key figures for trade-related agencies: USTR : Lawmakers designated $72.9 million for the Office of the U.S. Trade Representative, an increase of $2.8 million, or 4 percent, compared with fiscal year 2021. That includes $15 million from the Trade Enforcement Trust Fund. The figure is in line with the amount President Joe Biden requested earlier this year. International Trade Commission : The ITC budget would be raised $15.5 million compared with fiscal year 2021, bringing its total to $118.5 million. That's a 15 percent bump. International Trade Administration: ITA's proposed budget comes to $577.4 million, an increase of $36.4 million, or 6.7 percent, above fiscal year 2021. That's part of a broader boost across the entire Commerce Department, which has a proposed budget of $10.95 billion. HOUSE COMMITTEE SLATED TO VOTE ON EAGLE ACT: The House Foreign Affairs Committee left for the July Fourth recess after a marathon markup of Chair Gregory Meeks' (D-N.Y.) "Ensuring American Global Leadership and Engagement Act" (H.R. 3524 (117)). This week, lawmakers return for a marathon of votes. The committee is scheduled to meet on Tuesday and Thursday to vote on dozens of amendments to the bill, which is part of a larger legislative effort to make the U.S. more competitive with China. Partisan discord : The markup was rife with partisan fighting as Republicans pushed for amendments to constrain trade with China and Democrats argued they would hamstring U.S. companies doing business there. Republicans pressed for roll call votes on their amendments, even those likely to fail. A Republican committee staffer told Morning Trade that little has changed since then and projected few Republicans would support the bill without major adjustments. Among the key votes to watch are amendments that would stiffen export controls on companies tied to the Chinese military and prevent climate change funding from going to China. "The EAGLE Act is like bringing a knife to a gunfight — it doesn't really utilize our strongest tools to address our strongest adversary," Rep. Steve Chabot (R-Ohio), the ranking member of the Asia subcommittee, told Morning Trade in a statement. "I won't be able to support it unless the final product takes a substantially more vigorous approach." MORE VOTES TO WATCH THIS WEEK: Elsewhere on Capitol Hill, the Senate Finance Committee will vote Tuesday to advance the nominations of Sarah Bianchi and Jayme White to serve as deputy U.S. trade representatives. The duo enjoyed a relatively painless confirmation hearing late last month, though it was clear many lawmakers are eager for the Biden administration to begin brokering trade deals. The White House tabled those efforts in order to address the pandemic and its economic fallout. Bianchi would take on a broad portfolio that includes charting U.S. trade policy with China, which USTR is in the midst of reviewing under U.S. Trade Representative Katherine Tai's leadership. Meanwhile, White's similarly sweeping mandate would include trade with Europe, including ongoing talks over steel and aluminum tariffs and the newly formed U.S.-EU Trade and Technology Council. Even as those nominations are poised to advance, the White House and USTR have been mum on picks to serve as ambassador to the World Trade Organization and the chief agricultural negotiator. For comparison, President Donald Trump appointed people to those roles around this time in 2017, though they weren't confirmed by the Senate until the following year. A MODEL FOR FIXING FUTURE LABOR DISPUTES?: The remediation plan that U.S. and Mexican officials reached last week to address workers' rights violations at a General Motors plant in central Mexico marks the first resolution of its kind under the U.S.-Mexico-Canada Agreement. It won't be the last. While a senior USTR official told reporters the agency could not anticipate the frequency of cases, labor complaints are bound to rise if the agreement's rapid-response mechanism delivers as promised. Already, the U.S. and Mexico are probing labor groups' concerns about a Tridonex auto parts factory in Mexico. But whether the remediation plan, which requires the Mexican government to schedule and supervise a new union vote, becomes a model for settling future disputes likely depends on how it's implemented, labor experts told Morning Trade. "Carrying out the remediation plan as written is going to be a challenge, because it's different from business as usual in Mexico and I think it's going to end up being a very important learning experience for everyone involved," said Sandra Polaski, a scholar at Boston University's Global Development Policy Center and member of the Independent Mexico Labor Expert Board. A key test case: The independent board has argued Mexico's unions have a conflict of interest when organizing collective bargaining votes with limited government oversight — the issue at the center of the GM complaint. The resulting remediation plan could create a blueprint for how to better manage union legitimization votes, said Polaski, who previously served as U.S. deputy undersecretary of labor. "It's one case, one instance, and yet, if it successfully deals with the problem, it points the way to further reforming the entire process," she said. A shared perspective: The U.S. and Mexico started negotiating the GM remediation plan from the same side of the table, in part because the Mexican government is eager to support labor groups and usher in labor reforms, said Antonio Ortiz-Mena, a senior vice president at Albright Stonebridge Group. "On labor issues, I would say that we can expect that most of the time the Mexican government will be probably aligned with U.S. concerns or complaints," said Ortiz-Mena, who previously served as head of economic affairs at the Embassy of Mexico. "The current Mexican government is pretty much pro-labor, pro-union." That unity may wane as the countries haggle over more contentious issues like environmental protections, he said. It also remains to be seen how the rapid-response mechanism holds up when Mexico files a labor complaint against the U.S. (The Mexican government has informally raised concern about the treatment of U.S. farm and meatpacking workers.) "Let's see now how it goes from south to north, and not only from north to south," he said. THE BRITISH (TRADE OFFICIALS) ARE COMING: U.K. Trade Secretary Liz Truss is in Washington for meetings with Tai and key Democratic lawmakers to discuss countering problematic trade practices from nonmarket economies like China, per the British Embassy. "Workers in both the U.K. and U.S. have suffered when their products are unfairly undercut," Truss said in a statement. "We must work together with our friends and allies in the U.S. to protect free enterprise from practices like industrial subsidies and intellectual property theft, which give trade a bad name." Those talks will also include bilateral trade issues, such as Section 232 tariffs on British steel and aluminum and the U.K.'s interest in resuming negotiations on a free trade agreement. Off to Silicon Valley: Truss will then fly out to California for meetings with tech executives and associates of Democratic Gov. Gavin Newsom. Her West Coast agenda includes touting the U.K. as home to a thriving tech sector and encouraging U.S. industry leaders to invest there. She'll also call for a bilateral trade agreement that sets a "gold standard" for digital trade rules. "With U.K.-U.S. trade supporting over a million jobs in both countries, there is clear reason to work together to deepen our trade and investment ties and build back better," she said. "Together we can build on our credentials as two great innovating nations, and take this opportunity to shape the future of digital trade." FINANCE MINISTERS APPROVE GLOBAL TAX DEAL : The G-20 finance ministers agreed to a minimum corporate tax over the weekend that aims to prevent companies from shifting their profits into tax havens around the globe. The proposal was already endorsed by 130 countries last week through the Organization for Economic Co-operation and Development, and it could be made official after the G-20 leaders meet in Rome in October. The deal's approval would be a major win for the Biden administration, which has pushed countries to take up a minimum corporate tax in lieu of imposing digital services taxes on major technology companies, many of which are based in the U.S. | 
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